If the U.S. Treasury is forced to sell bills and bonds to foreigners to finance deficits, this may ________ the price of bonds and ________ the interest rates on the bonds.
A. drive down; drive down
B. drive up; drive up
C. drive up; drive down
D. drive down; drive up
Answer: D
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Which of the following factors influence the position of the long-run aggregate supply curve?
A) government spending B) the supply of money C) the level of full-employment output D) taxes
Strawberries, a normal good, are produced in a perfectly competitive market. Average consumer incomes increase. This will cause the individual strawberry farmer?s marginal revenue to ________ and their profit-maximizing level of output to ________.
A. increase; increase B. increase; decrease C. decrease; increase D. decrease; decrease
If the steady-state capital—labor ratio is equal to the Golden Rule capital—labor ratio, then in the steady state
A) output per worker equals investment per worker. B) output per worker equals depreciation per worker. C) investment per worker is as large as possible. D) consumption per worker is as large as possible.
"According to Keynes, the economy is essentially a self-regulating system." Do you agree or disagree? Why?
What will be an ideal response?